The only real sure things in life are death and taxes or so the old saying goes. And that is true to a point. Death is the one thing we can all count on to find us at some point in time. Hopefully that time will not come until we are as prepared as we can be for it at the end of a long and fruitful time on this Earth. But because there is no guarantee it may be a wise idea to purchase a life insurance policy to protect your loved one’s financial security just in case death decides to become impatient. In case the uncertainty of life is not a good enough reason for you, here are 8 reasons why you should purchase a life insurance policy.
1) Provides an income
Life insurance provides an all-important income for your family in the event you are no longer around to provide one for them. The death benefits from a life insurance policy can be used to pay off your mortgage, pay off credit card bills, and provide an education for your children and many other necessary things in life. Life insurance takes the financial burden from the shoulders of your surviving family. Just because you are no longer around to make sure their financial future is secure does not mean it should not be.
2) Pay Debts
We all have debt of some kind. When we die our debts are left to our loved ones to pay whether they have the means or not. Add not only our debt but also the cost of a funeral and even last minute medical bills to the picture and your family could be in real trouble. A life insurance policy can keep your family from all of these expenses as well as allow them to maintain the life style you gave them before you passed away.
3) Serve as an inheritance
A life insurance policy can serve in place of any other inheritance. But remember to set up a trust for any grown children to protect their rightful share from divorce or your ex-in-law could benefit as well. You may also wish to set up a like account for young children to manage any monies until they are old enough to manage it for themselves. Children who are under a certain age are not known for their financial acumen. Perhaps a trust released on their 25 the birthday would be a good idea.
4) Safe guard your domestic partner
If you are in a same sex or live in relationship you need to consult an attorney. Many states do not recognize a domestic partnership and as such will not allow a domestic partner to inherit your life insurance unless you specifically state that is your wish in your will.
5) Alimony and child support
A life insurance policy is to safeguard your loved ones. If you are divorced your life insurance policy can be used to pay your child support or alimony obligations.
6) Maintain parents and grandchildren
Are aging parents or grandchildren a part of your dependents? A life insurance policy can be used to make sure your parents or grandchildren are taken care of.
7) Protect your dependents if you work in an at risk area
If you are a member of the military or work in a high risk area you especially need a life insurance policy to safe guard your family.
8) Keep your business going
If you own a small business your life insurance policy can keep the business going for your family even if you are no longer available to run it.
As you go through all this, this article is your life insurance guide that will help you with insurance related decisions.